Every year, employers that meet certain criteria (100+ employees, or 50+ employees for those with federal contracts) must disclose to the Equal Employment Opportunity Commission (EEOC) the number of individuals they employ by race, ethnicity, gender and job category. Under an Obama-era executive order, these reporting requirements would have expanded this year to include pay data.
However, as of late August 2017, the new pay data portion of the EEO-1 report is indefinitely postponed. This means all affected employers should continue to use the previously approved form to report the necessary data.
An Attempt to Address Pay Inequity
According to the U.S. Census Bureau, full-time working women earn 80¢ for every dollar earned by men. This gender wage gap persists despite the Equal Pay Act, which prohibits employers from paying different wages for similar job positions.
The proposal to expand the EEO-1 form was driven by the EEOC’s desire to identify and reduce this type of pay discrimination. With more detailed pay data, the EEOC and the Office of Federal Contract Compliance Programs (OFCCP) could better gauge the extent of pay inequality across industries and occupations, as well as increase their efforts to prevent it.
Part of a Trend Toward Less Federal,
More Local Regulation
The postponement of this new EEO-1 reporting requirement is part of a larger trend under the Trump administration to ease business regulations. Yet, as the federal government reduces (or even rolls back) employee-related regulations, many states and municipalities are stepping in with their own laws.
“I believe the issue of equal pay will gain momentum at the state and local levels over the coming months,” says Shanna Wall, Employment Law Attorney at ComplyRight. “As we have seen with the minimum wage, state, county and city lawmakers will seek to bridge the divide left by the federal government.” This, according to Wall, will only add to the regulatory complexity and burden that employers face.
As it is, many states have already passed laws expanding the protections of the federal Equal Pay Act. For example, the California Fair Pay Act states that employees don’t need to work at the same location to have comparable jobs (and, therefore, require equal pay). For greater transparency, the California law also permits employees to talk about their wages with one another.
Similarly, New York’s Achieve Pay Equity law lets employees discuss wages, while also requiring employers to justify their wages if two employees receive different pay rates. The decision must be based on education, training or experience.
Current EEO-1 Reporting Requirements
Remain in Place
Although it won’t be necessary to share pay data through the EEO-1 report after all, employers have an ongoing responsibility to comply with any federal, state or local equal pay laws that apply to them.
Also, annual EEOC reporting requirements still stand for private employers with 100 or more employees and federal contractors with 50 or more employees. Rather than the usual due date of September 30, the next deadline is March 31, 2018.